Revenge of the repossessed

Although Britain has so far avoided the extremities of the US, Spain and Ireland, all the elements of a perfect storm are gathering in the wider housing system. Large numbers of households can simply no longer afford their mortgage. In 2004, there were 8,200 repossessions in the UK; in 2009, that figure had jumped to 48,000. Last year it was 36,300 and similar numbers are predicted for the coming years due to low growth, mass unemployment and public sector cuts.

The implications are serious for an economy so indelibly tied to the fortunes of the housing market. Repossessions further depress house prices, in turn reducing household wealth, increasing crime, hitting consumer spending, making it more difficult for people to move home because of falling equity and worsening credit ratings for large numbers of people, which will increase their cost of borrowing in future years. And none of this compares to the destructive effects of home loss to people and community. Read More: